China: Zhengzhou City proposes metaverse plan

The municipal government of Zhengzhou — the capital of China’s Henan Province — issued a set of policy proposals Wednesday aimed at supporting metaverse companies operating within its jurisdiction, with plans to establish a 10 billion yuan (US$1.42 billion) fund dedicated to the industry.

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Fast facts

• The policies include a series of cash benefits to attract metaverse-related companies to set up shop in the city.
• According to a government report, metaverse companies that move their headquarters to Zhengzhou are eligible to receive a startup capital investment of up to 200 million yuan (US$28.34 million). Such companies will also be eligible for other benefits such as rent subsidies.
• All companies developing metaverse use cases in the city —headquartered there or otherwise — will also be eligible to receive up to 5 million yuan (US$710,000) for every project certified as workable by the municipal government.
• The policies apply to locally operating enterprises focused on two specific areas. First: research into metaverse-related technologies such as virtual reality, augmented reality and brain-computer interfaces. Second: the adoption of metaverse technologies for real-world industries like education, entertainment and commerce.
• To fund its metaverse initiatives, the municipal government of Zhengzhou plans to set up a 10 billion yuan metaverse industrial fund. It will work with other government agencies and investment firms to issue a further 50 billion yuan (US$7.08 billion) in funding to support metaverse-related development projects. The city will also provide cash rewards to metaverse companies if and when they are listed on China’s primary stock exchanges.
• The exact launch date for the allocation of the funds has yet to be announced.
• Along with the funding policies it announced, the municipal government also mapped out its future vision for Zhengzhou’s metaverse development. It projects that the city’s metaverse-related industries will reach an annual revenue total of over 200 billion yuan (US$28.34 billion) by the end of 2025.
• The plan lists blockchain as one of the key technologies in its projections for the metaverse industry, along with next-generation computer rendering, human-computer interfaces, artificial intelligence and more.
• To support the city’s metaverse industry, Zhengzhou will encourage the development of consortium and private blockchains. It will also establish a digital asset market based on non-fungible token (NFT) technology.
• Open-source public blockchains were not mentioned in the plan, however, in an indication of a possible stumbling block for Chinese authorities’ approach to blockchain technologies.
• Zhengzhou has joined a plethora of Chinese cities and provinces vowing to become leaders in the country’s metaverse development. South-eastern metropolis Shanghai anticipates its metaverse industry to hit an annual revenue of 350 billion yuan by the end of 2023. It has also announced the launch of a 10 billion yuan metaverse industrial fund for launch July 2023.

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